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Tasmania’s Stories

AA+ credit rating confirmed

Edition 180_Peter Gutwein ...

Tasmania has moved from seventh to fourth place in a ranking of State and Territory economies and has had its AA+ credit rating reaffirmed by international rating agency, Standard and Poor’s.

“We consider the State of Tasmania has very strong financial management, a strong economy, exceptional liquidity, and low contingent liabilities,” Standard and Poor’s said.

The agency described the State's outlook as "stable" and respected economist Saul Eslake told The Mercury: "In a relative sense, our employment position is improving."

He said the trend unemployment rate of 6.4 per cent was now lower than rates in Western Australia and South Australia and this had been noted in the latest CommSec State of the States report.

"It's better news than we normally get from the CommSec series," Mr Eslake said.

Tasmania's population growth has improved and the State is doing better than the national average in export and retail growth.

In December, Mr Eslake had warned of underlying issues in the economic structure.

Delivering the Tasmanian Chamber of Commerce and Industry’s second Tasmania Report, Mr Eslake said Tasmanians were poorer on average than other Australians, mainly because of the lack of net employment growth since the Global Financial Crisis in 2008.

"The average Tasmanian household income is $43,600, which is a whopping 32 per cent below the national average," he said.

"Regional Tasmanians have been especially hard hit by the decline in manufacturing since the GFC which, by some yardsticks, has been more pronounced in Tasmania than in South Australia ... as well as by the long-term decline of industries such as forestry."

Mr Eslake said the north and north-west had shown great resilience, while transformation programs planned by the University of Tasmania in Launceston and Burnie could amount to game-changers.

He said Hobart was heading in the right direction in many economic areas, including real estate.

He attributed the State's lower-than-expected growth rate of 1.3 per cent largely to downturns in three sectors: agriculture; energy; and manufacturing.

"All were almost certainly caused by a combination of droughts and floods and the Basslink cable [outage]," Mr Eslake said.

In summary, he said the State was being held back by:

  1. An employment participation gap – only 46.2 per cent of the population was employed, 3.4 per cent below the national average.
  2. An hours-worked gap – Tasmanians workers were averaging 30.7 hours a week, 1.5 hrs less than the national average (equivalent to the loss of 12 days a year).
  3. A productivity gap – Tasmanian workers are producing $15 (or 18 per cent) less per hour than the Australian average.

Meanwhile, the State Treasury reported that Tasmania was leading the nation in five of 17 economic measures monitored by the Australian Bureau of Statistics, but was lagging elsewhere.

The State’s annual performances on retail sales and car sales have been much stronger than national results and export growth has been far ahead of the national average.

Tasmanian wages have grown faster, recently, than those in other Australian jurisdictions.

The State is also a touch ahead of the nation on State Final Demand growth, which adds household and government consumption to private and government spending on assets.

A series of monthly retail turnover records has been set in Tasmania in recent times, with monthly turnover topping $500 million for the first time.

October retail figures came out after the Treasury analysis, showing 3.9 per cent annual growth, compared to 3.4 per cent nationally.

The dollar value of Tasmanian merchandise exports increased by 8.7 per cent in the year to the end of September, while Australia’s export value dropped by 4.8 per cent.

Tasmania’s population growth rate was 0.4 per cent in the year to the end of March, lagging behind the national rate of 1.4 per cent.

Investment in tourism infrastructure is rising much more quickly in Tasmania than the national average and should deliver significant employment in the future.

A State Government report on tourism released in December showed:

  • A 4 per cent increase in visitor numbers to 1.19 million people;
  • An 8 per cent increase in visitor spending to $2.07 billion;
  • 74 per cent of visitors recommending Tasmania to others — the highest percentage in the nation; and
  • More than $500 million planned in tourism investment.

In January, a Deloitte Access Economics report confirmed that Tasmania's economy was "doing OK", but noted a recent reduction in fulltime jobs and population growth that was weaker than the national average.

Then MyState’s latest economic update reported that the economy had reached new heights, with retail and tourism driving jobs growth, especially in the second half of last year.

Mr Gutwein said: "This is the fifth report in a matter of weeks to highlight positive signs in the economy."

There was still more to come: an Office Market Report by the Property Council of Tasmania showed that demand for office space was continuing to grow despite a flow of new accommodation, while vacancy rates were the third lowest in the country, behind only Melbourne and Sydney.

The Premier, Will Hodgman, was especially encouraged by Standard and Poor’s rating decision.

"This is the second-highest rating available under Standard and Poor’s system and sees Tasmania ranked higher than Western Australia and South Australia and on par with Queensland," Mr Hodgman said.

"The main reason for the credit rating is the fact that the Hodgman Government has balanced the Budget for the first time in years.

"Our spending is under control and while revenue is tight, we are investing in the areas that matter: health; education; and protecting the vulnerable."

The Australian Government also avoided a ratings down-grade in December.

Canberra issued a Mid-Year Economic and Fiscal Outlook which the Tasmanian Treasurer, Peter Gutwein, described as "a steady-as-it-goes approach" to Tasmania.

Mr Gutwein said a projected $12.1 million reduction in GST distributions to the State over four years represented only a fraction of a percentage change.

"Pleasingly, the outlook confirms that the 2016 Federal election commitments are all funded, including the UTAS redevelopment in the north and north-west, the Regional Jobs and Investment Package, and the National Institute for Forest Products Innovation in Launceston," Mr Gutwein said.

Image courtesy of the ABC

8 February 2017, Edition 180

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Facts about Tasmania

Tasmania

Tasmania is the southernmost state of Australia, located at latitude 40° south and longitude 144° east and separated from the continent by Bass Strait. It is a group of 334 islands, with the main island being 315 km (180 miles) from west to east and 286 km (175 miles) north to south.

Tasmania

Tasmanians are resourceful and innovative people, committed to a continually expanding export sector. In 2012-13, international exports from the state totalled $3.04 billion. USA, China, Taiwan, India, Japan and other Asian countries account for the bulk of exports, with goods and services also exported to Europe and many other regions.

Geography

Tasmania is similar in size to the Republic of Ireland or Sri Lanka. The Tasmanian islands have a combined coastline of more than 3,000 km.

Geography

The main island has a land area of 62,409 sq km (24,096 sq miles) and the minor islands, taken together, total only 6 per cent of the main island's land area. The biggest islands are Flinders (1,374 sq km/539 sq miles), King, Cape Barren, Bruny and Macquarie Islands.

Geography

About 250km (150 miles) separates Tasmania’s main island from continental Australia. The Kent Group of Islands, one of the most northerly parts of the state, is only 55km (34 miles) from the coast of the Australian continent.

Climate

Twice named 'Best Temperate Island in the World' by international travel magazine Conde Nast Traveler, Tasmania has a mild, temperate maritime climate, with four distinct seasons.

Climate

In summer (December to February) the average maximum temperature is 21° Celsius (70° Fahrenheit). In winter (June to August) the average maximum is 12° C (52° F) and the average minimum is 4° C (40° F). Snow often falls in the highlands, but is rarely experienced in more settled areas.

Annual Rainfall

Tasmania’s west coast is one of the wettest places in the world, but the eastern part of the State lives in a rain-shadow. Hobart, the second-driest capital city in Australia, receives about half as much rain as Sydney.

Annual Rainfall

Annual rainfall in the west is 2,400 mm (95 inches), but hardy locals insist there is no such thing as bad weather, only inadequate clothing. If you travel 120 km east to Hobart, you experience a much drier average of 626 mm (24 inches) a year.

Population

The 512,875-strong community spreads itself across the land; less urbanised than the population of any other Australian state. Hobart, the capital city, is home to more than 212,000 people.

Capital City

Hobart nestles at the foot of Mt Wellington (1,270 m / 4,000 ft) and overlooks the Derwent Estuary, where pods of dolphins and migrating whales are sometimes seen from nearby beaches. Surrounded by thickly forested rolling hills, the city is home to the state parliament and the main campus of the University of Tasmania.

Capital City

Its historic centre features Georgian and Regency buildings from colonial times. Hobart is home port for coastal fishing boats, Antarctic expeditions and vessels that fish the Southern Ocean.

Land Formation

Mountain ranges in the south-west date back 1,000 million years. Ancient sediments were deeply buried, folded and heated under enormous pressure to form schists and glistening white quartzites.

Land Formation

In the south-west and central highlands, dolerite caps many mountains, including Precipitous Bluff and Tasmania's highest peak, Mt Ossa (1617 m / 5300 ft). More than 42 per cent of Tasmania is World Heritage Area, national park and marine or forest reserves.

Flora

Vegetation is diverse, from alpine heathlands and tall open eucalypt forests to areas of temperate rainforests and moorlands, known as buttongrass plains. Many plants are unique to Tasmania and the ancestors of some species grew on the ancient super-continent, Gondwana, before it broke up 50 million years ago.

Flora

Unique native conifers include slow-growing Huon pines, with one specimen on Mt Read estimated to be up to 10,000 years old. Lomatia tasmanica, commonly known as King's holly, is a self-cloning shrub that may well be the oldest living organism on earth. It was discovered in 1937.

Fauna

Tasmania is the last refuge of several mammals that once roamed the Australian continent. It is the only place to see a Tasmanian devil or eastern quoll (native cat) in the wild and is the best place to see the spotted-tailed quoll (tiger cat), all carnivorous marsupials.

Fauna

The eastern bettong and the Tasmanian pademelon, both now extinct on the Australian continent, may also be observed.

Fauna

The Tasmanian tiger, or thylacine, was Australia's largest surviving carnivorous marsupial and is a modern day mystery. The last documented thylacine died in captivity in 1936 and although the animal is considered extinct, unsubstantiated sightings persist.

History and Heritage

Aboriginal people have lived in Tasmania for about 35,000 years, since well before the last Ice Age. They were isolated from the Australian continent about 12,000 years ago, when the seas rose to flood low coastal plains and form Bass Strait.

History and Heritage

Descendants of the original people are part of modern Tasmania's predominantly Anglo-Celtic population.

History and Heritage

Tasmania was originally named Van Dieman’s Land by the Dutch explorer Abel Janszoon Tasman in 1642. The island was settled by the British as a penal colony in 1803 and the original name was associated with the convict era. It was changed to Tasmania when convict transportation stopped in 1853.

Economy

A resourceful island culture has generated leading-edge niche industries, from production of high-speed catamaran ferries and marine equipment to lightning-protection technology.

Economy

Tasmanians produce winches and windlasses for some of the world's biggest ocean-going pleasure craft; large-scale inflatable evacuation systems and provide specialist outfit-accommodation services to the marine industry.

Economy

The Wooden Boat Centre at Shipwrights Point has re-established the skills and traditions of another age and attracts students from around the world.

Economy

Tasmania is a world leader in natural turf systems for major sporting arenas and in areas of mining technology and environmental management. Its aquaculture industry has developed ground-breaking fish-feeding technology and new packaging.

Economy

Tasmanians sell communications equipment to many navies and their world-class fine timber designers and craftsmen take orders internationally for furniture made from distinctive local timber.

Economy

The state is a natural larder with clean air, unpolluted water and rich soils inviting the production of 100 varieties of specialty cheeses, as well as other dairy products, mouth-watering rock lobsters, oysters, scallops and abalone, Atlantic salmon, beef, premium beers, leatherwood honey, mineral waters, fine chocolates, fresh berry fruits, apples and crisp vegetables.

Economy

Tasmania is a producer of award-winning cool-climate wines, beers, ciders and whiskies. Other export products include essential oils such as lavender, pharmaceutical products and premium wool sought after in Europe and Asia. Hobart is a vital gateway to the Antarctic and a centre for Southern Ocean and polar research.

Economy

The industries in Tasmania which made the greatest contribution to the state's gross product in 2010-11 in volume terms were: Manufacturing (9.4%), Health care and social assistance (8.2%), Financial and insurance services (7.2%), Ownership of dwellings and Agriculture, forestry and fishing (each 7.1%).

Getting to Tasmania

Travel is easy, whether by air from Sydney or Melbourne, or by sea, with daily sailings of the twin ferries Spirit of Tasmania 1 and 2 each way between Melbourne and Devonport throughout the year.

This site has been produced by the Brand Tasmania Council © 2014

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